Wednesday was a difficult day for Wall Street. Stocks were punished following a vicious and swift market reversal that began around 11:00 am and continued into the close. All of the major indices closed within the lower third of their intraday trading ranges. The S&P MidCap 400 and the small-cap Russell 2000 fared the best on the day, as they closed down 1.0% and 1.1% respectively. The Nasdaq plunged by 1.9% while the Dow Jones Industrial Average and the S&P 500 both shed 2.0% on the session.
Market internals were decidedly negative on Wednesday, as volume was up and selling was broad based. Turnover on the Nasdaq increased by 10% and on the NYSE by 11.4%. Declining volume overpowered advancing volume by a ratio of 10.1 to 1 on the NYSE and 5.6 to 1 on the Nasdaq. Wednesday would appropriately be categorized as a distribution day for the market.
Due to the recent sharp increase in volatility, it is a good time to evaluate the health of the broad market. Below are charts of the Nasdaq, Dow and SPY. The analysis is self explanatory and should provide a clear picture of the recent damage done to the market.
Yesterday, we sent an intraday alert that we were opening a trade in the ProShares Short MSCI Emerging Market ETF (EUM). Our Entry was triggered by the sharp reversal in the market around 11:30 am. This late morning reversal carried EUM above the 1 hour high and we entered the trade. A move above yesterday’s high of $32.62 could provide another entry trigger. Above this level we will consider adding to the trade. Trade details can be found in the Open Positions segment of the newsletter.
It is noteworthy that market leadership took a hit as AAPL dropped over 5% on the day. This Friday is triple witching options expiration day which could bring whipsaw trading action. As long as volatility remains high, we will continue to monitor and communicate potential setups on an intraday basis. Nonetheless, If our research uncovers setups that meet our technical criteria we will put them in the newsletter.
There are no new setups for today. We will send an Intraday Alert if any new trades are made.
Daily Performance Report:
Below is an overview of all open positions, as well as a performance report on all positions that were closed only since the previous day’s newsletter. Net P/L figures are based on the $50,000 Wagner Daily model account size. Changes to open positions since the previous report are listed in red text below. Please review the Wagner Daily Subscriber Guide for important, automatic rules on trigger and stop prices
Per intraday alert, we bought EUM.
- Reminder to subscribers – Intraday Trade Alerts to your e-mail and/or mobile phone are normally only sent to indicate a CHANGE to the pre-market plan that is detailed in each morning’s Wagner Daily. We sometimes send a courtesy alert just to confirm action that was already detailed in the pre-market newsletter, but this is not always the case. If no alert is received to the contrary, one should always assume we’re honoring all stops and trigger prices listed in each morning’s Wagner Daily. But whenever CHANGES to the pre-market stops or trigger prices are necessary, alerts are sent on an AS-NEEDED basis. Just a reminder of the purpose of Intraday Trade Alerts.
- For those of you whose ISPs occasionally deliver your e-mail with a delay, make sure you’re signed up to receive our free text message alerts sent to your mobile phone. This provides a great way to have redundancy on all Intraday Trade Alerts. Send your request to [email protected] if not already set up for this value-added feature we provide to subscribers.
Having trouble seeing the position summary graphic above?
Click here to view it directly on your Internet browser instead.
Edited by Deron Wagner,
MTG Founder and